Public Storage 1999 Annual Report Download - page 29

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U B LI C T O RAG E,N C . 1999 N N UAL RE P O RT
Common stock
During 1999, 1998 and 1997, we issued and repurchased shares of our common stock as follows:
1999 1998 1997
(Dollar amounts in thousands) Shares Amount Shares Amount Shares Amount
Public offerings — $ — 7,951,821 $234,521 6,600,000 $181,448
In connection with mergers (Note 3) 13,009,485 347,223 433,526 13,817 7,681,432 212,000
Exercise of stock options 511,989 10,000 219,596 3,339 94,786 1,075
Issuance to affiliates — — 853,700 26,362 — —
Conversion of OP units 241,071 6,434————
Conversion of Convertible
Preferred Stock — — 3,589,552 53,308 2,363,901 61,621
Acquisition of interests in real
estate entities 1,557,960 40,027 635,005 16,679 — —
Repurchases of stock (4,589,427) (108,565) (2,819,400) (72,256) — —
10,731,078 $ 295,119 10,863,800 $275,770 16,740,119 $456,144
Shares of common stock issued to affiliates in 1998 were in exchange for interests in real estate entities. All the shares of common stock,
with the exception of the shares issued in connection with the exercise of stock options, were issued at the prevailing market price at the time
of issuance.
On June 1, 1998, we exercised an option to redeem the 8.25% Convertible Preferred Stock in exchange for common stock, at the
conversion rate of 1.6835 shares of common stock for each share of Convertible Preferred Stock. Pursuant to the redemption, which was
effective July 1, 1998, we issued 3,503,303 shares of common stock.
On June 12, 1998, we announced that the Board of Directors authorized the repurchase from time to time of up to 10,000,000 shares
of the Company’s common stock on the open market or in privately negotiated transactions. Cumulatively through December 31, 1999, we
repurchased a total of 7,408,827 shares of common stock at an aggregate cost of approximately $180,821,000. On March 4, 2000, the Board
of Directors increased the authorized number of shares which the Company could repurchase to 15,000,000.
On March 12, 1999, we issued 13,009,485 shares of common stock pursuant to the merger with Storage Trust Realty and reserved
1,011,963 additional shares for issuance upon conversion of units in Storage Trust Realty’s operating partnership.
At December 31, 1999, the Company had 4,707,779 shares of common stock reserved in connection with the Company’s stock option
plans (Note 11), 7,000,000 shares of common stock reserved for the conversion of the Class B Common Stock and 770,892 shares reserved
for the conversion of OP Units.
Class B common stock
The Class B Common Stock will (i) not participate in distributions until the later to occur of funds from operations (“FFO”) per Common
Share, as defined below, aggregating $1.80 during any period of four consecutive calendar quarters, or January 1, 2000; thereafter, the Class B
Common Stock will participate in distributions (other than liquidating distributions), at the rate of 97% of the per share distributions on the
Common Stock, provided that cumulative distributions of at least $0.22 per quarter per share have been paid on the Common Stock, (ii) not
participate in liquidating distributions, (iii) not be entitled to vote (except as expressly required by California law) and (iv) automatically
convert into Common Stock, on a share for share basis, upon the later to occur of FFO per Common Share aggregating $3.00 during any
period of four consecutive calendar quarters or January 1, 2003.
For these purposes, FFO means net income (loss) (computed in accordance with generally accepted accounting principles) before (i) gain
(loss) on early extinguishment of debt, (ii) minority interest in income and (iii) gain (loss) on disposition of real estate, adjusted as follows: (i)
plus depreciation and amortization (including the Company’s pro-rata share of depreciation and amortization of unconsolidated equity interests
and amortization of assets acquired in a merger, including property management agreements and goodwill), and (ii) less FFO attributable to
minority interest. For these purposes, FFO per Common Share means FFO less preferred stock dividends (other than dividends on convertible
preferred stock) divided by the outstanding weighted average shares of Common Stock assuming conversion of all outstanding convertible
securities and the Class B Common Stock.
For these purposes, FFO per share of Common Stock (as defined) was $2.50 for the year ended December 31, 1999.